Issues from Indonesia, China Taiping, Sri Lankan bank; Russian banks under pressure

By Christine Van Dusen

Atlanta, Sept. 2 – Indonesia, Korea Development Bank, China Taiping Insurance Holdings Co. Ltd. and Sri Lanka’s National Savings Bank sold notes on Tuesday, as long-dated bonds from the Middle East saw demand and Russian banks remained under pressure.

“Duration still has a bid, despite the performance of the long bond, with Qatar, Saudi Arabia and Abu Dhabi long bonds in demand,” a London-based trader said. “Special mention to Qtel International’s 2043 – bid today above par. A decent squeeze on this one.”

Russia, and its ongoing conflict with Ukraine, remained in focus as news outlets reported that President Vladimir Putin said he could “take Kiev in two weeks.” This followed talks on Tuesday in Misk between pro-Russia rebels and Ukraine.

“With the Ukraine army now under pressure, Kiev’s willingness to negotiate may well have increased,” a London-based analyst said. “Nonetheless, a breakthrough does not seem imminent.”

The tension is expected to be discussed at the upcoming NATO meeting, set for Thursday and Friday.

“It’s worth keeping an eye on Russian assets,” the London trader said. “Some of the big state banks have really come under pressure again lately.”

Market sources pointed to OAO Sberbank’s 2019s, which were yielding about 6% on Tuesday.

“Russia is opening a little weaker this morning, with market activity increasing as the holiday period comes to an end,” the analyst said. “Banks and corporates are generally wider.”

In deal-related news, Brazil’s Gol Linhas Aereas Inteligentes SA and Dubai’s Emirates NBD set roadshows for upcoming issues.

Indonesia prices bonds

Indonesia printed the day’s biggest deal, with $1.5 billion 4.35% Islamic bonds due Sept. 10, 2024 pricing at par to yield 4.35%, a syndicate source said.

The notes were talked at a yield in the 4.4% area.

CIMB, Emirates NBD Capital, HSBC and Standard Chartered Bank were the bookrunners for the Rule 144A and Regulation S deal.

Sri Lanka bank prints notes

Sri Lanka’s National Savings Bank sold $250 million 5.15% notes due Sept. 10, 2019 (expected ratings: /B+/BB-) at par to yield 5.15%, a syndicate source said.

The notes were talked at a yield in the 5.2% area.

Barclays, Citigroup and HSBC were the bookrunners for the Rule 144A and Regulation S deal.

The issuer is a Colombo-based lender.

Issue from Korea Development

Korea Development Bank sold $750 million 2½% notes due March 11, 2020 (expected ratings: Aa3//AA-) at 99.98 to yield Treasuries plus 82.50 basis points, a market source said.

The notes priced tighter than talk, set in the Treasuries plus 95 bps area.

BNP Paribas, BofA Merrill Lynch, Deutsche Bank, JPMorgan, KDB Asia, Mizuho Securities and Standard Chartered Bank were the bookrunners for the Securities and Exchange Commission-registered deal.

The proceeds will be used for general operations, including extending foreign currency loans and repaying maturing debt, according to a company filing.

Chinese insurer sells bonds

China Taiping Insurance Holdings Co. Ltd. priced a $600 million issue of 5.45% perpetual notes (expected rating: /BBB-/) at par to yield 5.45%, a market source said.

HSBC Ltd. and Standard Chartered Bank were the joint global coordinators, joint lead managers and joint bookrunners. CCB International Capital Ltd. was also a joint lead manager and joint bookrunner. Taiping Capital Ltd. was a co-manager.

The proceeds from the Regulation S deal will be used for general corporate purposes.

China Taiping Insurance is an insurance conglomerate based in Hong Kong.

Tsinlien Group sets talk

China’s Tsinlien Group Co. Ltd. set talk at 5.2% to 5¼% for a planned issue of up to RMB 8 billion of three-year notes, a market source said.

DBS Bank, Citic Bank, HSBC, ICBC and Wing Lung Bank are the bookrunners for the Regulation S deal, which could price as soon as Tuesday.

The issuer is a Hong Kong-based investment holding company.

Roadshow for Brazilian airline

Brazil’s Gol Linhas Aereas Inteligentes SA will set out on Wednesday for a roadshow to market a dollar-denominated issue of notes, a market source said.

The roadshow will begin in Miami and travel to Los Angeles, London, Zurich and Geneva before concluding on Sept. 9 in New York, Boston and Germany.

A Rule 144A and Regulation S deal with bookrunners BB Securities, Bradesco BBI, Citigroup, Morgan Stanley and Santander is expected to follow.

The proceeds will be used to fund the tender offers of the company’s 7½% 2017 notes, the 9¼% 2020 notes and the 10¾% 2023 notes. Any other proceeds will be used for general corporate purposes.

The discount air carrier is based in Sao Paulo.

Emirates NBD sets roadshow

Dubai’s Emirates NBD has set a roadshow for a dollar-denominated issue of benchmark-sized perpetual notes, a market source said.

Morgan Stanley and Standard Chartered Bank are the joint global coordinators, and Citigroup, Commerzbank, Deutsche Bank, Emirates NBD Capital, Morgan Stanley and Standard Chartered Bank are the joint lead managers for the Regulation S deal.

The roadshow will begin on Sept. 4 in Dubai and Abu Dhabi, then move to London and Hong Kong before concluding on Sept. 9 in Singapore.

Emirates NBD is a provider of corporate, consumer, treasury and investment banking and asset management services.

Oceanwide releases final book

The final book for China Oceanwide Holdings Group Co. Ltd.’s (COHG) new $320 million 11¾% notes 2019 – which priced Monday at 99.080 to yield 12% – was $700 million, a market source said.

Citic Securities and UBS were the bookrunners for the Regulation S deal.

The proceeds will be used for land acquisitions.

About 95% of the orders came from Asia and 5% from Europe, with 63% from fund managers, 24% from private banks, 8% from banks and 5% from corporates and others.

The company is a real estate business based in Beijing.

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